Your cache administrator is webmaster. Check out using a credit card or bank account with PayPal. The right thing to do in this case would be to estimate (4), not to estimate (1) using a method that corrects for serial correlation. Therefore, that information is unavailable for most Encyclopedia.com content.

Linear Regression Home Site Map Site Search Xycoon College Free Online Software Online Econometrics Textbook - Regression Extensions - Assumption Violations of Linear Regression - Misspecification in Linear Regression[Home] [Up] Unlimited access to purchased articles. The system returned: (22) Invalid argument The remote host or network may be down. Unless X and Z happened to be uncorrelated, this would cause the estimate of β 1 to be biased.

The classic way of dealing with this type of specification error is to use instrumental variables (IV). Even if a regression model is correctly specified in the sense that the relationship between the regressand and the regressors is correct and the regressors are uncorrelated with the error terms, Buy article ($14.00) Have access through a MyJSTOR account? In Bollen, Kenneth A.; Long, J.

See also[edit] Model risk Regression model validation References[edit] ^ This particular example is known as Mincer earnings function. ^ Long, J. Access supplemental materials and multimedia. Wikipedia® is a registered trademark of the Wikimedia Foundation, Inc., a non-profit organization. PREVIEW Get Access to this Item Access JSTOR through a library Choose this if you have access to JSTOR through a university, library, or other institution.

Find Institution Buy a PDF of this article Buy a downloadable copy of this article and own it forever. Loading Processing your request... × Close Overlay Skip to main content Search Research categories Research categories Earth and Environment History Literature and the Arts Medicine People Philosophy and Religion Places Plants Generated Thu, 20 Oct 2016 19:00:30 GMT by s_wx1157 (squid/3.5.20) ERROR The requested URL could not be retrieved The following error was encountered while trying to retrieve the URL: http://0.0.0.9/ Connection ISBN978-0-07-337577-9.

Maddala, G. The American Statistician Vol. 25, No. 5, Dec., 1971 Some Notes on Misspe... How does it work? This test is based on a test-equation where the original equation is expanded with powers of the interpolation fit series (powers 2, 3, etc...).

If evidence of serial correlation is found, it is common, but not always wise, to employ an estimation method that “corrects” for it, and there are many such methods. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list. Login to your MyJSTOR account × Close Overlay Purchase Options Purchase a PDF Purchase this article for $14.00 USD. Hence specification diagnostics usually involve testing the first to fourth moment of the residuals.[2] Contents 1 Specification error and bias 2 Detection 3 See also 4 References 5 Further reading Specification

This is most likely to occur with time-series data and with data where the observations fall naturally into groups, or clusters. PREVIEW Get Access to this Item Access JSTOR through a library Choose this if you have access to JSTOR through a university, library, or other institution. London: Sage. JSTOR, the JSTOR logo, JPASS, and ITHAKA are registered trademarks of ITHAKA.

Retrieved October 11, 2016 from Encyclopedia.com: http://www.encyclopedia.com/social-sciences/applied-and-social-sciences-magazines/specification-error Learn more about citation styles Citation styles Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from Testing Structural Equation Models. JSTOR2286231. The problem is that many types of specification error can produce the appearance of serial correlation.

A more general model is which includes the square of X as an additional regressor. Estimation methods that are unaffected by certain types of specification error are often said to be robust. One of the simplest is just to use heteroskedasticity-robust standard errors instead of conventional standard errors. Buy article ($14.00) Have access through a MyJSTOR account?